Trump's trade representative publicly calls out president's ignorance on trade deals in incident that left Trump 'embarrassed'

Reuters/Kevin Lamarque

US President Donald Trump stands with Trade Representative Robert Lighthizer

• Robert Lighthizer, the man in charge of leading US trade negotiations with China, publicly clashed with President Donald Trump over the likely form that a mooted trade agreement with Beijing will take.
• Trump and Lighthizer clashed during a press conference at the White House Friday, with the pair disagreeing on the definition of a so-called memorandum of understanding (MOU).
• An MOU generally sets out the requirements and responsibilities of two parties entering contract negotiations, but is among the first steps to establish a legally binding contract.
• Video shows the pair discussing the meaning of such an agreement for around two minutes in the Oval Office.
• The president reportedly admonished Lighthizer in the clash, saying he had been "embarrassed" by the trade representative's public subordination.

Robert Lighthizer, the man in charge of leading US trade negotiations with China, publicly clashed with President Donald Trump over the likely form that a mooted trade agreement with Beijing will take.

Late Sunday, a video of Trump speaking to reporters at the White House last Friday, began to circulate on social media networks, showing the president and US Trade Representative Lighthizer clashing over the definition of a so-called memorandum of understanding (MOU), a key document generally created during the negotiation of a contract.

You can see the full exchange below:

After the clash, Trump privately admonished Lighthizer for directly contradicting him in public, saying the incident had left him embarrassed, according to a report from Bloomberg.

Bloomberg also reports that Trump is growing increasingly frustrated with Lighthizer, driven by the major stock market plunge witnessed late last year, which saw US stocks have their worst end to a year since the Great Depression, almost 90 years ago.

Frustration is reportedly mutual, with Bloomberg adding that Lighthizer "has been growing irritated with Trump's interventions."

Trump's confusion over the meaning of an MOU

When asked by a reporter if an MOU - which sets out the requirements and responsibilities of two parties entering contract negotiations - would be a "long term deal," Trump replied by saying that such agreements "don't mean anything."

"I think the MOU is going to very short term," he said.

"We expect to go into it. I don't like MOUs because they don't mean anything. You're better off just going into a document. I was never a fan an MOU," the president continued.

He was, however, interrupted by Lighthizer, who attempted to describe the legal meaning of the term: "An MOU is a contract. It's the way trade agreements are generally used. People refer to it like a term sheet. It's not a term sheet, it's an actual contract between two parties. A memorandum of understanding is a binding agreement between two people, and that's what we're talking about."

Trump then shot back, saying: "By the way, I disagree, I think that a memorandum of understanding is not a contract to extent that we want."

"We're doing a memorandum of understanding that will be put into a final contract I assume, but to me the final contract is really the thing Bob - and I think you mean that too - that means something."

The pair then went back and forth with one another, before Lighthizer eventually suggested that the team would do away with the term altogether to prevent confusion. They would from then on, Lighthizer said, call the MOU a "trade agreement."

"Good, I like that much better," Trump replied.

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Footage of the clash was taken just two days before Trump said that his administration would delay the increase of tariffs on Chinese goods as talks to end the trade war between the world's two largest economies continue.

The delay, which comes less than a week before the previously set deadline, has been greeted with delight in financial markets, with stocks in Asia witnessing huge gains Monday. China's benchmark index, the Shanghai Composite, saw its biggest single day rally since 2015 on the day, jumping close to 6%.